QUESTION: Which one best describes the use of positive leverage?

A. For an all cash deal, you are making an equity contributing of $1M to buy a $1M property making a 10% return. However, if you able to obtain a loan of $800K (at reasonable interest rate terms) then your equity contribution is only $200K and making a higher return of only 10%.

B. For an all cash deal, you are making an equity contributing of $1M to buy a $1M property making a 10% return. However, if you able to obtain a loan of $800K (at reasonable interest rate terms) then your equity contribution is only $200K and making a higher return of only 12%.

C. For an all cash deal, you are making an equity contributing of $1M to buy a $1M property making a 10% return. However, if you able to obtain a loan of $800K (at competitive low interest rate terms) then your equity contribution is only $200K and making a higher return of 18%.

D. For an all cash deal, you are making an equity contributing of $1M to buy a $1M property making a 10% return. However, if you able to obtain a loan of $800K (at high interest rate terms) then your equity contribution is only $200K and making a lower return of 9%